OWN CORRESPONDENT, Pretoria | Thursday 2.20pm
THE South African Revenue Service confirmed on Thursday that there have been “serious problems” in tax returns for the 1998-1999 tax year. The mistake has resulted in some taxpayers being asked to repay massively inflated amounts of tax, while others received a surprise windfalls — which will have to be repaid. It appears as if the botch-up affects tax payers nationwide. The problem was first raised when tax consultants noticed errors in a high percentage of tax assessment, with some accounting firms claiming the returns they processed were all flawed. SARS national communications office Fani Zulu said the service became aware of the problem in early February and that a task team has been set up to deal with the problem and to take corrective actions. Zulu said that the problems were caused by human error and not faults in the new computer system, which came into use on December 17. He said user error had been exacerbated by the pressure on employees to capture a backlog of assessments. Duncan McAllister, acting manager of law administration at the SARS, said that the problems stem mainly from coding and capturing errors. He said one problem, for example, is that taxpayers were entering gross remuneration (including fringe benefits) on the return, as well as fringe benefits. Since all sources of income are captured separately, this leads to the fringe benefits being taxed twice. He was quoted in the Daily Despatch as saying: “Under the new system, taxpayers need to exercise care when completing their returns and should ensure that all information is accurately entered.” McAllister assured the public that the problems were being continuously investigated. “While all staff did receive training, it must be appreciated that there is a learning curve as staff get to grips with the practical implementation of the system. “I would suggest that taxpayers carefully check their returns against their assessments, particularly where unexpected refunds or amounts payable are reflected.